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General Dynamics (GD) Q2 Earnings Beat, Revenues Miss
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General Dynamics Corporation (GD - Free Report) announced second-quarter 2016 earnings from continuing operations of $2.44 per share, beating the Zacks Consensus Estimate of $2.30 by 6.1%. Reported earnings were also up 7.5% from $2.27 recorded in the year-ago quarter.
General Dynamics’ total revenue of $7,665 million missed the Zacks Consensus Estimate of $7,953 million by 3.6%. Reported revenues were also down 2.8% from $7,882 million in the year-ago quarter.
The decrease was due to lower contributions from the Aerospace, Combat Systems and Marine segments.
Backlog
The company recorded total backlog of $63.2 billion, down 9.7% year over year. Funded backlog at the quarter end was down 4.3% to $53.1 billion.
Aerospace: The segment reported second-quarter 2016 revenues of $2,134 million, down 5.5% year over year. Operating earnings of $434 million decreased from $439 million in the year-ago quarter.
Combat Systems: Segment revenues dropped nearly 6.6% to $1,315 million. Operating earnings were down 3.1% to $219 million in the quarter.
Information Systems and Technology: The segment reported revenues of $2,229 million, up 0.6%. Operating income improved 3% to $244 million.
Marine Systems: The segment’s revenues of $1,987 million were down 0.7% from the year-ago figure of $2,001 million. Operating income also declined 3.2% to $181 million.
Operational Highlights
Company-wide operating margin expanded to 14% from the year-ago level of 13.7%.
In the quarter under review, General Dynamics’ operating costs and expenses declined nearly 3% to $6,595 million.
Financial Condition
As of Jun 30, 2016, General Dynamics’ cash and cash equivalents were $1,899 million, compared with $2,785 million as of Dec 31, 2015.
Long-term debt as of Jun 30, 2016 was $2,899 million, almost in line with the 2015-end level of $2,898 million.
In the first half of 2016, the company’s cash flow from operating activities was around $873 million, compared with $1,433 million in the year-ago period. Free cash flow from operations in the second quarter was $324 million, as against $538 million in the prior year.
Other Aerospace & Defense Releases
The Boeing Company (BA - Free Report) delivered second-quarter 2016 adjusted loss of 44 cents per share, narrower than the Zacks Consensus Estimate of loss of 88 cents. In the prior-year quarter, however, the company has reported earnings of $1.62.
Northrop Grumman Corporation (NOC - Free Report) reported second-quarter 2016 adjusted earnings of $2.60 per share, beating the Zacks Consensus Estimate of $2.50 by 4%. Reported earnings were also up 5.3% from $2.47 recorded in the year-ago quarter.
Lockheed Martin Corp. (LMT - Free Report) reported second-quarter 2016 earnings of $3.32 per share, surpassing the Zacks Consensus Estimate of $2.92 by 13.7%. Earnings were also up 12.9% from the year-ago level.
Zacks Rank
General Dynamics currently has a Zacks Rank #2 (Buy).
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General Dynamics (GD) Q2 Earnings Beat, Revenues Miss
General Dynamics Corporation (GD - Free Report) announced second-quarter 2016 earnings from continuing operations of $2.44 per share, beating the Zacks Consensus Estimate of $2.30 by 6.1%. Reported earnings were also up 7.5% from $2.27 recorded in the year-ago quarter.
Total Revenue
General Dynamics’ total revenue of $7,665 million missed the Zacks Consensus Estimate of $7,953 million by 3.6%. Reported revenues were also down 2.8% from $7,882 million in the year-ago quarter.
The decrease was due to lower contributions from the Aerospace, Combat Systems and Marine segments.
Backlog
The company recorded total backlog of $63.2 billion, down 9.7% year over year. Funded backlog at the quarter end was down 4.3% to $53.1 billion.
GENL DYNAMICS Price, Consensus and EPS Surprise
GENL DYNAMICS Price, Consensus and EPS Surprise | GENL DYNAMICS Quote
Segment Performance
Aerospace: The segment reported second-quarter 2016 revenues of $2,134 million, down 5.5% year over year. Operating earnings of $434 million decreased from $439 million in the year-ago quarter.
Combat Systems: Segment revenues dropped nearly 6.6% to $1,315 million. Operating earnings were down 3.1% to $219 million in the quarter.
Information Systems and Technology: The segment reported revenues of $2,229 million, up 0.6%. Operating income improved 3% to $244 million.
Marine Systems: The segment’s revenues of $1,987 million were down 0.7% from the year-ago figure of $2,001 million. Operating income also declined 3.2% to $181 million.
Operational Highlights
Company-wide operating margin expanded to 14% from the year-ago level of 13.7%.
In the quarter under review, General Dynamics’ operating costs and expenses declined nearly 3% to $6,595 million.
Financial Condition
As of Jun 30, 2016, General Dynamics’ cash and cash equivalents were $1,899 million, compared with $2,785 million as of Dec 31, 2015.
Long-term debt as of Jun 30, 2016 was $2,899 million, almost in line with the 2015-end level of $2,898 million.
In the first half of 2016, the company’s cash flow from operating activities was around $873 million, compared with $1,433 million in the year-ago period. Free cash flow from operations in the second quarter was $324 million, as against $538 million in the prior year.
Other Aerospace & Defense Releases
The Boeing Company (BA - Free Report) delivered second-quarter 2016 adjusted loss of 44 cents per share, narrower than the Zacks Consensus Estimate of loss of 88 cents. In the prior-year quarter, however, the company has reported earnings of $1.62.
Northrop Grumman Corporation (NOC - Free Report) reported second-quarter 2016 adjusted earnings of $2.60 per share, beating the Zacks Consensus Estimate of $2.50 by 4%. Reported earnings were also up 5.3% from $2.47 recorded in the year-ago quarter.
Lockheed Martin Corp. (LMT - Free Report) reported second-quarter 2016 earnings of $3.32 per share, surpassing the Zacks Consensus Estimate of $2.92 by 13.7%. Earnings were also up 12.9% from the year-ago level.
Zacks Rank
General Dynamics currently has a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>